Tieto presentation 2014 fina lshort

Company presentation

Tieto

The world is changing at an accelerating pace.

Disruption is a new normal, which is a challenge for achieving and sustaining growth.

Industry change can, however, also provide great opportunities for those who see what’s coming next and have the agility to respond when the time is right.

Today’s challenge

©Tieto Corporation3

Changes in both human behaviour and technology driving industry disruption

Behavioural change

Technology disruption

Social

Cloud

Analytics

Mobile

“Innovate or vanish”

Higher clock speed

Global market place

Customised

experience

Networked

New normal for efficiency

Real time


Digitalisation is centred around each individual and is pushing the limits of technology

Intelligentmachines

Privacy & security

Energy efficiency

Mass customi-

sation

Contextsensitivity

• Unlimited computing power and storage

• Real-time analytics

• Machine learning

• Security vulnerabilities

Technology expectations

This is Tieto

©Tieto Corporation

Tieto’s storyBy applying our deep industry expertise, technology vision and innovative thinking, we help our customers cut through complexity and master change.

In doing so, we inspire, engage and deliver as we help our customers accelerate their business to stay strong in today’s global marketplace.


#1Tieto is the largest company in the Nordics that provides full lifecycle services in IT, as well as product development, for private and public organisations.

Building on our Nordic heritage and values, we have global capabilities and a strong presence where our customers need it – in the Nordics or via local delivery centres across the globe.

Operating countries

in telecom R&D in Europe

#1

in IT services in Sweden

#3

in IT services in Finland

#1


Net sales (EUR million)Operating profit (EUR million)EBIT (%)Operating profit excl. one-off items (EUR million)EBIT (% excl. one-off items)Profit after taxes (EUR million)EPS (EUR)Net cash flow from operationsGearing (%)

1 825.363.03.5138.87.629.40.41161.94.5

2012

1606.885.75.3141.28.862.20.86159.03.0

2013*

Key figures

* Restated according to IFRS 11


Managed Services 31%Consulting and System Integration 25%_x000d_Industry Products 26%Product Development Services 18%

Managed Services 14%

Consulting and System Integration 21%

Industry Products 53%

Product Development Services 13%

Financial Services 20%Forest 5%Manufacturing 6%Retail and Logistics 9%Healthcare and Welfare 15%Public Sector 9%Telecom 25%Media 3%Energy 7%Other 1%

Tieto’s market position:#1 in Finland, #2 in Sweden, #7 in Norway

Sales by industry

Sales by service line

EBIT by service line

*) Restated according to IFRS 11 **) Excluding capital gains, impairments and restructuring costs

Financial factsCustomer sales in 2013*): EUR 1607 millionEBIT margin excl. one-off items**): 8.8%


Our focus is the business value we createTo us, IT is business and business is IT

Business value

Technology vision

Industry insight

Innovative thinking

Technology expertise

End-customer insight

Global outlook


And we are committed to developing society through technology

Services support operations that are critical for society

More than 14.000 IT professionals

of which 8000 are in the Nordics

Invest more than EUR 100 million

annually in technology

Recognized for achievements in

corporate responsibility


Tieto is an active corporate citizen in society

Our long-term objectives are: • Create value for all stakeholders

• Be an ethical forerunner in society

• Minimise our environmental footprint

Our values are based on the United Nations Global Compact principles for environmental care, human rights, labor rights and anticorruption, and the OECD Guidelines for Multinational Enterprises.

These values are implemented throughout our operations and value chain.

In 2013, Tieto…

Helped our customers to reduce their

CO2 emissions by 183 kton

Decreased our CO2

emissions by 19%

Was a frontrunner in CR reporting

Helped 11,000 street

children in India through

NGO co-operation

Our strategy 2012 - 2016


Reinforcing industry expertiseBuilding on our long customer relationships and customer core process understanding as well as our possibility to combine industry-consulting, technology expertise and own products (IPR).

Expanding to provide full lifecycle IT services Investing in Consulting and System Integration capabilities, Managed Services and the product portfolio that differentiates us as a full lifecycle IT service provider.

Focusing on core marketsFocusing on the markets where Tieto has the opportunity to be among the top 3 players in its field. The current core market is the Nordics. In PDS, Tieto serves its customers worldwide.

Industries

Services

Markets

Our strategy builds competitiveness


Build the foundation

Execute the structure and

efficiency

Reorientingfor growth

Accelerategrowth

portfolio

Expand markets

2012 2013 2014 2015 2016

Journey proceeds as planned


Modernization of services in application and infrastructure management

Selected industry products: financial services, supply chain management, oil & gas

Cloud services, e.g. Tieto Cloud Server and Tieto Productivity Cloud

Supporting customers’ business by extending

from pure equipment sales to services

Leading Nordic industry solution for the healthcare and welfare

sector

CAGR ~20%, EUR >5B CAGR ~50%, EUR >5B CAGR >4%, EUR ~1B

Big and high growth market in the Nordics by 2020

Creating competitive advantage by

excelling in our interaction with clients

Customer Experience

Management

Industrial Internet

Lifecare

We are investing in growth areas


Product development service strategy

“We increase our customers’

business results through

productivity increase, faster time-to-market

with quality, and efficiency

through repeatability”

Technicalexpertise

Processes, tools & labs

Transform businessmodels

Spearhead consulting & Technology proof-points

Key industrytrends

Core services

General R&D services

Industry knowledge

Passionate people

Our core strategies

Industrysegments

Increase revenueDecrease costs

Reduce risksReduce CAPEX

Product development expertise

Reference architectures, Proof-of-concepts, Industry forums

NFV/SDN

Small cellsConnectivi

ty

SONUser experience R&D

cloud

Product end-of-life

Product evolution

Product transformati

on

New product

innovation

Next generation mobile

networksCloud services Connected

digital lifestyle


Onshore 55%

Czech 14%

India 11%

China 6%

Poland 5%

Other offshore 9%

Personnel

2009 2010 2011 2012 2013

0

5000

10000

15000

20000

0

5

10

15

20

25

30

35

40

45

50

16663 17757 18123 16537 14318

30

3740 42

45

Personnel Offshore %

Offshoring gradually increasingOffshore rate at ~45%

Primary expertise of each center1%-point increase in offshoring = EUR 5 million impact on EBIT

Czech – Managed Services

India – CSI & Industry Products

China – Product Development Services

Philippines – Product Development Services

Poland – Product Development Services

Changing perspectives

Tieto presentation 2014 fina lshort

Technology

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